Brand USA Research Discovers that Intent to Travel to USA is on the Decline
Hard numbers illustrating the impact of the stronger U.S. dollar vs. other currencies—especially the euro—have been absent from the discussion of the issue … until just recently. At the latest meeting of the Brand USA board of directors, the agency revealed a graph that clearly shows the negative impact of the stronger dollar on the intention to visit the USA by travelers in the key markets of Australia, Brazil, Canada, China, France, Japan South Korea and Mexico. Last year, these nations generated more than 70 percent of international travel to the United States.
Meanwhile, the outlook from Brazil remains negative. Although 2015 numbers for arrivals to the USA from Brazil are still being processed by the U.S. Department of Homeland Security and won’t be available for the current month until December or January, there are current data available on other metrics which illustrate the impact of the weak Brazilian real vs. the U.S. dollar.
For instance, the Brazilian Central Bank just reported that Brazilians spent 46 percent less on international travel in August this year compared with the same month of 2014.
For the first eight months of 2015, the Central Bank said spending fell 25 percent, down to $12.9 billion. From mid-August 2014 to mid-August 2015, the value of the real went from $0.44 to $0.287—a decline of 36 percent.
It’s Colombia’s Time: Savoring its New Status as South America’s Most Robust Inbound Market for USA
Tops among the hot topics discussed at the La Cita de las Americas trade show last month in Boca Raton, Fla., was the strength of the inbound market from Colombia. In recent years, it has escaped notice in the mainstream discussion of overseas source markets for the USA, despite all the strong markers—a stable economy, the growth of a travel-ready middle class, a substantial increase in lift capacity, proximity to the continental United States that almost makes it a short-haul market, and visitor numbers that make it the No. 11 overseas source market—because it had a major asterisk next to its ranking: a half-century of conflict and guerrilla war in parts of the country led primarily by FARC (FARC Fuerzas Armadas Revolucionarias de Colombia, or Revolutionary Armed Forces of Colombia), whose activities have been financed by drug-related revenues.
Then, last December, FARC unilaterally declared a cease fire. “Let’s talk” was the message conveyed to the Colombian government, which had been waging an aggressive internal war against the guerrillas. But talks convened in the third party state of Cuba. And then, last week, in Cuba, Colombian President Juan Manuel Santos and the top FARC leader, Rodrigo Londoño Echeverri (alias “Timochenko”) announced a major agreement on how justice shall be applied during the transition period from war to peace in Colombia. The accord includes amnesty for political crimes and the creation of a special peace court, as well as establishing that the guerrillas must hand over their arms within 60 days of signing the agreement.
The news prompted new coverage throughout Latin America that bordered on jubilation—from all quarters, including sports commentators and business news analysts. The latter hailed the agreement as one that will attract international investors, as well as tourism, to Colombia.
Prior to last week’s good news, the outbound tourism industry, as well as the infrastructure that supports it, had already begun to build some impressive numbers.
The Five-Year Ascendency of Colombia
To Its Position as Second Largest Market in South America
Arrivals (in 000s) in USA from Argentina, Venezuela and Colombia
2010-2015
| Year | Argentina | Venezuela | Colombia |
|---|---|---|---|
| 2011 | 512 | 561 | 497 |
| 2012 | 615 | 675 | 602 |
| 2013 | 686 | 788 | 748 |
| 2014 | 685 | 616 | 881 |
| 2015 | 664ᶠ | 450? | 969? |
ᶠ -ForecastSource: U.S. Department of Commerce, International Trade Administration, National Travel and Tourism Office (NTTO)
Rank by Population
Major South American Nations
| Country | Population | Rank in South America | Rank, Nations of World |
|---|---|---|---|
| Brazil | 203,657,210 | 1 | 5 |
| Colombia | 49,529,208 | 2 | 28 |
| Argentina | 42,154,914 | 3 | 32 |
| Venezuela | 31,292,702 | 4 | 41 |
| Peru | 31,161,167 | 5 | 42 |
| Chile | 17,924,062 | 6 | 61 |
| Ecuador | 16,225,691 | 7 | 68 |
| Bolivia | 11,024,522 | 8 | 82 |
| Paraguay | 7,032,942 | 9 | 105 |
| Uruguay | 3,429,997 | 10 | 136 |
| Total | 413, 435,000 (rounded) | -- | -- |
Source: Statistics Times
The population of Colombia, the second largest nation in South America—especially the key demographic group (25-54 years old) that comprises the traveling population—is destined to grow substantially because of the nation’s birthrate and young population. It exceeds that of the United States, for instance, among those from 0-54 years, yet is less than half that of the U.S. in the over-64 category.
Population of Colombia and USA
By Age Groups
| Age Group | Colombia | USA |
|---|---|---|
| 0-14 years | 25.30% | 20.10% |
| 15-24 years | 18% | 13.40% |
| 25-54 years | 41.60% | 40.60% |
| 55-64 years | 8.30% | 12.50% |
| 65 years and older | 6.70% | 14.40% |
| Total Population | 49,529,208 (2015 est.) | 325 million (2014 est.) |
The population of Colombia, the second largest nation in South America—especially the key demographic group (25-54 years old) that comprises the traveling population—is destined to grow substantially because of the nation’s birthrate and young population. It exceeds that of the United States, for instance, among those from 0-54 years, yet is less than half that of the U.S. in the over-64 category.
Population of Colombia and USA
By Age Groups
| Country | Population | Rank in South America | Rank, Nations of World |
|---|---|---|---|
| Brazil | 203,657,210 | 1 | 5 |
| Colombia | 49,529,208 | 2 | 28 |
| Argentina | 42,154,914 | 3 | 32 |
| Venezuela | 31,292,702 | 4 | 41 |
| Peru | 31,161,167 | 5 | 42 |
| Chile | 17,924,062 | 6 | 61 |
| Ecuador | 16,225,691 | 7 | 68 |
| Bolivia | 11,024,522 | 8 | 82 |
| Paraguay | 7,032,942 | 9 | 105 |
| Uruguay | 3,429,997 | 10 | 136 |
| Total | 413, 435,000 (rounded) | -- | -- |
Sources: Index Mundi, Statistics Times, U.S. Census Bureau, Statistical Abstract of the United States; prepared by Inbound Report (* Figures rounded )
Colombia’s major ports of departure—they are the airports in the five most populous cities—already have strong airline connections to the U.S. (Though Cartagena’s population ranks it fifth among Colombian cities, it is a favorite point of departure for travelers; a flight from Cartagena to Miami is about the same distance and time as a flight from New York City to Miami.)
Top Ten Cities in Colombia
By Population
| Bogota | 7,674,366 |
|---|---|
| Cali | 2,392,877 |
| Medellin | 1,999,979 |
| Barranquilla | 1,380,425 |
| Cartagena | 952,024 |
| Cucuta | 721,398 |
| Bucaramanga | 571,820 |
| Pereira | 440,118 |
| Santa Maria | 431,781 |
| Ibague | 421,685 |
Source: World Atlas
Lift capacity to and from the USA has increased dramatically in the past five years. U.S.-based legacy carriers have launched new service and new airlines (U.S.-based JetBlue and the new Viva Colombia) have started new routes. In addition, Copa airlines, which is based in neighboring Panama, has extensive reach into Colombia, often serving as a shuttle service for travelers who go to Panama City, then on to the USA. One thing made clear in the following table: Miami is the de facto capital of the United States for Colombian travelers.
Top 5 Cities in Colombia
For Air Connections to USA
| City and Airport | Carriers and Service to USA and Canada |
|---|---|
| Bogotá | El Dorado International Airport |
| El Dorado International Airport | Air Canada (Toronto-Pierson) |
| American Airlines (Dallas/Fort Worth, Miami) | |
| Avianca (Fort Lauderdale, Los Angeles, New York,-JFK, Orlando, Washington-Dulles) | |
| Delta Air Lines (Atlanta, New York-JFK) | |
| JetBlue Airways (Fort Lauderdale, Orlando) | |
| United Airlines (Houston-Intercontinental, Newark) | |
| Viva Colombia (Miami-begins Dec. 2, 2015) | |
| Cali | American Airlines (Miami) |
| Alfonso Bonilla Aragón International Airport | Avianca (Miami) |
| LAN Airlines (Miami) | |
| United Airlines (Miami) | |
| US Airways (Miami) | |
| Medillin | José María Córdova International Airport |
| José María Córdova International Airport | American Airlines (Miami) |
| Delta Air Lines (Atlantastarts Dec. 19, 2015) | |
| JetBlue (Fort Lauderdale) | |
| Spirit Airlines (Fort Lauderdale) | |
| Viva Colombia (Miamistarts Dec. 2, 2015) | |
| Barranquilla | American Airlines (Miami) |
| Ernesto Cortizzos International Airport | Avianca (Miami) |
| Cartagena | Air Transat (Seasonal: Montréal-Trudeau, Toronto-Pierson) |
| Rafael Núñez International Airport | Avianca (Miami, New York-JFK) |
| Delta Air Lines (Atlanta-Starts Dec. 19, 2015) | |
| JetBlue (Fort Lauderdale, New York-JFK) | |
| Spirit Airlines (Fort Lauderdale) | |
| Sunwing Airlines (Seasonal: Toronto-Pierson) |
Source: Airport websites and Wikipedia
What Makes Visitors from India Choose Group Travel?
Two months ago, Kuoni India was acquired by Fairfax Financial Holdings, whose founder, chairman and CEO, the billionaire Prem Watsa, has become a singular force in the nation’s tour and travel industry; his company already owned Thomas Cook’s India operations before the Kuoni acquisition. Then, just last week in a move that is reflection of the latter’s higher profile in India as well as Asia, Kuoni SOTC—it is the tour operator’s main outbound brand—released a first-ever comprehensive survey of the Indian travelers: the India Holiday Report 2015. The study was conducted by Nielsen with 900+ Indians across 6 cities – Mumbai, Delhi, Ahmedabad, Kolkata, Bangalore and Chennai in the age group of 25 to 60 years to understand the mindset and behavior of the Indian traveler towards holidays. Its results are full of info bytes useful to anyone researching the Indian market, which is now the ninth largest overseas source market for inbound tourism to the USA. Here, we’ve formatted some of the survey’s finding for quick reference.
| Category | Percentage of Survey Respondents |
|---|---|
| Indians believe that holidays are important | 90% |
| Respondents rate holidays higher than clothes and electronic gadgets | 15% |
| Respondents who chose group holiday, chose it because of their 'cost effectiveness' | 81% |
| Respondents who chose group holiday, chose it because of their inclination towards home food | 68% |
| respondents who take up to 20 days of leave annually | 83% |
| Those who cite personal health conditions as main reason for canceling holiday travel | 66% |
| Those who cite work commitments as a reason for canceling holiday travel | 63% |
| Category | Percentage |
|---|---|
| Percentage of those who save money for holiday | 64% |
| Prefer to go post-paid, instead of saving for the big trip. | 11% |
| Rely on spending the Bonus or Incentives on a holiday | 7% |
| Takes loans for their holidays, because of impulse | 7% |
| Percentage of annual income consumed by domestic holiday | 11% |
| Percentage of annual income consumer by international holiday | 5% |
| Use bank savings to pay for holidays | 5% |
| Use recurring deposits to pay for holidays | 4% |
| Category | Percentage |
|---|---|
| Take 11 to 20 days of leave per year | 44% |
| Take a holiday at least once a year | 80% |
| Take a holiday at least once in six months | 17% |
| Take a holiday at least once every three months | 6% |
Gender Differences—For Women, at Holidays is an Escape from Household Chores and for Men, It’s Seeking Space:
Women
—Women look at holidays primarily as an escape from the household chores. They seek pampering and indulgence which they are not usually able to indulge in back home.
—Long relaxing spas and beauty treatments tops the list of indulgence. Women respondents enjoy spending on shopping at the local markets and buying collectibles and souvenirs.
—Playing cards and indulging in adventure sports is a rising trend among them.
Men
—Men seek space when on a holiday. A holiday for them is fundamentally a holiday from people, networking and associating.
—Men love exploring quirky markets that are not to be found in their own city or country. The idiosyncrasy of the locale captivates a male traveler and adds to the thrill.
—Like women seek freedom from household chores, men want to free themselves from the burdens of workplace and economy. With family, some men feel uncomfortable ditching them for a bar hopping or night crawling session. Some prefer to visit places without families to avoid the guilt and discomfort if the family is not like minded.
Brand USA Board Meeting Summary: Introducing www.visittheusa.com.”
Starting this month, Brand USA will be transitioning to a new URL—www.VisitTheUSA.com—from the DiscoverAmerica.com that it has been using for nearly five years to promote the USA throughout the world. The members of the Brand USA board of directors had no problem when the agency’s staff announced the move at its recent board meeting.
Aside from the fact that the DiscoverAmerica.com was not developed or tested by Brand USA—it was turned over to BUSA by the U.S. Travel Association nearly five years ago, which was almost the same amount of time since it had been acquired through a deal made with a New England travel agency owner by the late Mike Pusateri when the latter was chief operator office of U.S. Travel—it simply did not fit with the message of Brand USA’s mission: to get travelers to visit the USA.
The DiscoverAmerica.com also did not distinguish the uniqueness of the USA, as it is not the only America. There are other Americas: South America, North America, Central America. While VisitUSA as a URL might seem logical, it is already in use worldwide as the global ID of the Visit USA Committee network: i.e., VisitUSA.org.uk, visitusa.co.nz, etc.
On the other hand, explained Anne Madison, chief communications officer, VisitTheUSA is specific to the United States and will help facilitate a seamless transition from DiscoverAmerica.com. Also the DiscoverAmerica.com will continue to be used and TheBrandUSA.com will remain as the agency’s corporate website.
When a question came from a call-in listener to the board’s conference call meeting asking if the new URL would result in a change to the “Brand USA” logo comprised of dots or, as Chief Marketing Officer David Whitaker called them, “bubbles,” Whitaker reassured the listener: “I don’t envision that changing,” explaining that “there is great equity” in the logo.
Concluded Whitaker: “The bubbles will stay.”
***
Note: “America’s Wild: A National Parks Adventure,” Brand USA’s much-awaited big screen film featuring Robert Redford as narrator, will have its worldwide debut Feb. 10, 2016 at the Air & Space Museum in Washington,D.C.
From the Travel News Smorgasborg—China Bytes
→ Following a week of talks by senior officials from both the U.S. and China, President Barack Obama and Chinese President Xi Jinping last week announced the U.S.-China Tourism Year for 2016, an initiative that celebrates last year’s reciprocal extension of visa validity and supports increased travel and tourism exports. Partnering under the framework of the U.S.-China Joint Commission on Commerce and Trade (JCCT), the two sides will work together to expand and shape U.S.-China travel and tourism. Throughout the year, the U.S. Department of Commerce and the China National Tourism Administration (CNTA), in collaboration with Brand USA and other partners, will design and execute a year of events and activities that will promote and further open travel between the United States and China, expand market access, and advance initiatives to ensure a quality visitor experience for increasing numbers of travelers to and from both nations.
→ Brand USA is now the lead organization on the U.S. side for the annual U.S.-China Leadership Summit. The ninth annual Summit was held in mid-September in Los Angeles, attracting more than 200 delegates. The first U.S.-China Leadership Summit was held in 2007, in Charlotte, N.C. Locations of the summit alternate between the U.S. and China yearly. The U.S. Travel Association initiated the summit in coordination with (China National Tourism Administration CNTA). After having prime responsibility every year for planning the summit on behalf of the United States, U.S. Travel phased out of this role in 2014, when it shared responsibilities with Brand USA.
→ In an update on the activities of the NTA China Inbound program, Haybina Hao, NTA‘s director of international development, reported that enrollment in NTA’s China Inbound Program reached 200 operators this year. When NTA launched its China Inbound Program in 2008, it qualified some 60 receptive tour operators for the program.
→ After being overlooked as a key target group in the decade since Chinese domestic and international tourism numbers began to take, the senior market is getting a serious look from tour operators and travel agents. News accounts of late have cited instances in which older Chinese have expressed the opinion that they were not treated with respect (in one article a tour guide said the travel industry doesn’t actively seek business from senior travelers because they pose too many risks while providing too little profit) nor were they offered products that accommodated their budgets as travel companies went after the target big-spending, 25-54 demographic group.
But a recent article in the Singapore-based online news publication, AsiaOne, pointed to the sheer size of the market as one reason that travel suppliers have begun to cultivate by developing more product for the over-55 population. Consider the following:
What seems to be appealing to operators is that, although the margin for parsimonious seniors is low, the senior market is one that favors group travel, which helps to offset the low profit margin they realize. As such, travel companies and the government seem to be responding. The China Association of Travel Services, for instance, is working on guidelines for the industry that will focus on services, safety and healthcare for senior tourists. The standard, which is now being drafted, will require travel products to suit the psychological and physiological characteristics of older travelers.
Snapshot of Key Numbers
On the Senior Travel Market in China
| Category | Key Number |
|---|---|
| Chinese aged 60 and over in 2013* | 202 million |
| Est. Number of Chinese aged 60 and over in 2050 | 400 million |
| Proportion of Chinese 50 and older who definitely plan to travel | 87% |
* According to China’s Bureau of National Statistics
How I Got My Start in the Travel Trade
“How I Got My Start” is a regular segment in which we cull a couple of selections from our interviews with international operators, domestic operators, receptive operators, destinations, hotels and attractions to explore the path that led one to a career in the travel trade industry. One thing we have learned: the road to where they are is almost never the same. In this issue, we feature: Kent Elliott, destinations sales manager, Jackson Hole Chamber of Commerce, and Sheelagh Wylie, head of trade sales, Midway Attractions, North America, Merlin Entertainments PLC.
Kent Elliott: “Growing up in Sporting Goods Retail, I always enjoyed providing great customer service. After my stint in the USAF, I secured a position waiting tables at an upscale restaurant to help fund College. From there I was hooked on Hospitality. After graduating from the University of Wyoming, I worked at a Ranch/Resort in Jackson, Wyoming. The general manager of the resort asked me my future plans, and I basically told him that I want his chair. From there he mentored me and I was involved in all facets of the Resort for 10 years. Twenty years later, I am still at it and couldn’t be happier being in hospitality.”
Sheelagh Wylie: “My first job out of college was working for Tim Forbes, President of American Heritage Magazine, then a division of Forbes Magazine. I was a marketing assistant and then special projects coordinator specializing in advertising sections promoting state tourism. I later got a job as public information office for the new Northern Ireland Tourist Board in New York. The NITB job was fabulous because I got to spend so much time in Northern Ireland, Ireland and Britain. I spent precious time visiting with my grandparents in Bangor, County Down before and after business trips. Eventually, I became the travel trade manager at NITB and later moved on to the New Jersey Division of Travel & Tourism as the international marketing manager. (She then went on to join Madame Tussauds, a Merlin property …)
HODGE PODGE—Shifts, Shakeups and Occasional Shaftings in the Tour and Travel Industry
Stephanie Dowling has been named deputy director of the Arizona Office of Tourism. As the new addition to office’s executive marketing team, Dowling will focus on the strategic development of the agency’s advertising, PR and communications programs. Dowling, who has nearly 20 years of experience in communications, public relations and advertising. Her CV includes a tenure as director of public relations and marketing for The Westin Kierland Resort & Spa in Arizona. In September 2013, she was named regional director of public relations for Starwood Hotels & Resorts in Hawaii. She was later promoted to regional director of marketing communications.
Dominic Tucker has joined low-cost carrier Norwegian from British Airways as UK head of sales. Previously Tucker had spent 14 years in a number of commercial roles at British Airways, including revenue management, alliance sales and account management. He also worked in consumer sales.
Oswaldo Freitas is the new regional director of sales for Latin America, JTB Americas, with the mission of bringing to Brazil the services of its receptive tour operator American TPI (Travel Plaza International). Founded in 1964, the JTB Americas is one of six JTB Corporation Japanese holdings in the world.
In an effort to increase its ExclusiveDeals business, Tourico Holidays has named Michael Deane as the new senior strategic product director, ExclusiveDeals, or pre-purchased hotel room blocks, currently make up 2 percent of Tourico’s global inventory, but account for 42 percent of the company’s revenue. Deane joined Tourico in 2009. In his new post, he will report to Dermot Quigley, the executive vice president of product development.
Tourico has also announced the appointment of and Bill Chambers as vice president, strategic product development. Chambers joined Tourico more than two years ago as a regional product director. He previously served for eight years as director of strategic product development for Hotelbeds. Chambers will also report to Dermot Quigley, the executive vice president of product development.
Christine Leader, a familiar presence at NAJ’s Active America China Summit each year, has left Great Wall Travel , which is based in the Greater Los Angeles area, to take on the job of marketing director for New Sun International Travel, which is headquartered in Commerce, California—also in the Greater Los Angeles area. New Sun is a receptive tour operator that brings visitors from Asia, with most of them (80 percent) from China.
This past Spring, Uschi Brunner, who had been with New World Travel for the past 15 years–most recently as director of groups and Incentives—became business development manager for CI Events, a strategic corporate event management company with operations in Australia, the UK and Hong Kong.
Thomas Cook announced early this week that Chris Mottershead is replacing Salman Syed as the UK managing director of the company. Syed is leaving to “pursue external opportunities,” the company said in a statement, adding that Mottershead is taking over Oct. 1, and that Syed will stay with the business until October 31. Syed has been in the position for just over a year. He joined the company in 2013 as managing director of Cook’s Western and Eastern European business. Peviously, Syed was managing director of Asia Pacific at First Advantage Corporation and prior to that he served in a number of roles at Premier Farnell Plc. Mottershead left Tui last March join Thomas Cook, originally as business development director, before he was promoted to commercial director in July. He began his travel career with Airtours in the early 1990s before joining Tui as UK managing director.
